Dec 21 2007
Palomar Medical Technologies, Inc., a leading researcher and developer of light-based systems for cosmetic treatments, today announced an agreement with The Gillette Company (a wholly owned subsidiary of The Procter and Gamble Company) to extend the Launch Decision of a home-use, light-based hair removal device for women until no later than February 29, 2008. Under the existing Development and License Agreement entered into by Palomar and Gillette on February 14, 2003 and as Amended and Restated on February 14, 2007, Gillette had until January 7, 2008 to make the Launch Decision.
During this extension period, Palomar and Gillette have agreed to enter into negotiations for a new agreement to replace the existing one. The goal of a new agreement would be to enable the parties to continue to work together to fully capitalize on the market potential. Although no assurances can be given as to the outcome of these negotiations, it is anticipated that a new agreement would include the release of Palomar from exclusivity and the retention by Gillette of non-exclusive rights to Palomar's technology and intellectual property.
In return for a release from exclusivity, Palomar anticipates that there would be a reduction in the percentage of net sales that Gillette pays to Palomar and a change from annual payments under the existing agreement to reduced calendar quarterly payments for a certain period. There can be no assurances that Palomar and Gillette will reach a new definitive agreement, or that an agreement, if reached, will contain the terms currently under negotiation. If the parties do not agree, the existing agreement could be terminated.
Designed specifically for use in the home and based on over a decade of research, the consumer light based hair removal device represents a major breakthrough in the aesthetic device industry and is the first light-based hair removal device to receive a 510(k) over-the-counter (OTC) clearance from the United States Food and Drug Administration (FDA). OTC clearance allows the device to be marketed and sold directly to consumers without a prescription. Gillette and Palomar have conducted over 11 clinical studies with over 600 subjects (and thousands of treatments) which demonstrate that, when used as directed, the light based device delivers comfortable, effective, skin-safe hair removal.
Chip Bergh, P&G Group President said: "We are encouraged with the progress that has been made over the past years in working together. We are hopeful that we can reach mutually-agreeable terms as we renegotiate the agreement so that we can continue to work together to bring this promising technology to the consumer, in-home market."
Commenting on this development, Palomar Chief Executive Officer Joseph P. Caruso said, "Together with Gillette we have developed game changing technology with the potential for a tremendous impact on women's every day lives. We are looking forward to advancing this technology into the consumer market with a strategy designed to increase consumer awareness."